MPs challenge Barclays boss over bank's former supremo Bob Diamond

Barclays boss Antony Jenkins has been challenged by the banking commission to prove his claims that he stood up to predecessor Bob Diamond over the bank’s flawed culture.

It came as the chairman, Sir David Walker, pledged to slash bonuses after Barclays set aside another £1bn compensation for the mis-selling of payment protection insurance and interest rate swaps to small businesses.

Giving evidence to the Parliamentary Commission on Banking Standards, Jenkins indicated he appealed to his former boss during board meetings to ensure the bank behaved more ethically.

Jenkins admitted the bank had become ‘too aggressive’ under Diamond, conceding his attempts to overhaul the culture at Barclays amounted to ‘shredding’ the legacy of his predecessor.

But Barclays’ new broom faced a sceptical audience in the commission which demanded to see evidence he had been committed to changing the bank’s culture before being made chief executive.

The hearing came just hours after Barclays revealed it had set aside another £600m for PPI and another £450m for mis-selling interest rate swaps to small firms.

The bank (up 3.75p to 295.25p) also confirmed it had paid £100m, including fees to lawyers Clifford Chance, to help US and UK regulators with their investigations into the rigging of Libor rates. This resulted in a £290m fine last summer, but just 13 staff have been disciplined and five fired.

The banking commission urged Barclays to hand over legal advice provided to the board on disciplinary action taken against those involved in the affair.

Swiss bank UBS yesterday reported losses of £1.3bn for the last three months of 2012, largely due to the £940m fine for Libor rigging.